Eastern Europe: Opportunities and challenges in the CIS

Eastern Europe: Opportunities and challenges in the CIS

Lasha Machavariani discusses the current state of regulated betting in the CIS region

Delegates at last week’s iGaming Super Show were treated to an expansive presentation on the potential for, and current state of, regulated betting in and around the CIS region.

During the show, SBC News ambassador Lasha Machavariani gave an overview of gambling in Russia, Ukraine, Belarus, Kazakhstan, Armenia and Georgia.

Kazakhstan, in particular, is a territory in which one operator rules supreme, with Olimp accounting for around 85% of the market.

Prospective Kazakh operators need an offline licence in order to enter the online marketplace. This, according to Machavariani, makes it a difficult market to crack, and he pointed to Parimatch’s expensive attempt to do so as a prime example.

Armenia is another he described as difficult to succeed in – especially given recent regulatory changes. In January 2017, Armenian betting licence fees went from $200,000 to $1 million, meaning any operators considering entering must be more cautious and committed.

Machavariani highlighted Ukraine as the “hottest” country in the region, and one which has the greatest potential for betting. He also predicted that the country will be seeing more regulation in the near future.

Moving onto Georgia, where Machavariani himself hails from, the audience was given a thorough explanation of its history with betting and the current market structure. The country’s first betting shop opened in 1993, but it wasn’t until 1998 that the first branded betting shop – in the form of Adjarabet – opened its doors.

Adjarabet became the first in the country to go online in 2004, and in 2012 Playadjara went live via the Everymatrix platform. This, says Machavariani, changed the game in Georgia, as the launch was bolstered by extensive promotional efforts and vast improvements in customer service.

Betsson entered Georgia in 2015 with the acquisition of Europe-Bet, but Machavariani pointed to the operator’s “failure to think locally” as the reason for its lack of success here.

Nobody in Georgia knew the Betsson brand prior to its entry, and a targeted marketing campaign, in Machavariani’s opinion, would have gone a long way.

As it stands, the main players in Georgia are Adjarabet, Europe-Bet, Crystalbet, Leaderbet, Crocobet and Betlive. Together, these brands own 95% of the market.

Machavariani explained the market structure and the importance of multi-product brands. More uniquely, he highlighted a reliably strong call centre as another important tool in the country. There is a great lack of affiliates and there’s undoubtedly an opportunity to capitalise on this front, he said.

Indeed, the opportunity in Georgia is clear: the amount of mobile internet users has grown 22% in the past year, while those with home internet access has elevated at an even greater rate of 26% in the same period.

Moreover, it’s a fully regulated market, and the country ranks 16th globally for ‘ease of doing business’.

Totally Gaming says: Lasha Machavariani opened the eyes of those in attendance at his talk at the iGaming Super Show to the vast potential for operators, and the gambling industry as a whole, in CIS region right now. The expectation is that more big betting brands will move in on the space sooner rather than later – but for now the door is well and truly open.

Upcoming Event: EIG expo, taking place 30 October to 1 November 2017, Arena Berlin, will be continuing discussions on the challenges and opportunities in the CIS region. Take a look at the agenda or register today at www.eigexpo.com